Hype or Reality: Will the $23B Analytics Market Spend Impact the $3.5T in US Healthcare Spend? Only When Insights Optimize Workflow.

According to a recent forecast by P&S Market Research, the healthcare big data analytics market will experience a strong compound annual growth rate (CAGR) of 22% through 2023, reaching a market value of $22.7 billion. Another recent survey of healthcare C-suite executives by NewVantage Partners confirmed that the pace of investment in big data and artificial intelligence is increasing, fueled by the need for business transformation and competitive pressures. However, the authors of the survey also noted that they would guess, with high confidence, that “…the great majority of spending on big data and AI goes for technology and its development. We hear little about initiatives devoted to changing human attitudes and behaviors around data.” In other words, investing in data without also investing in how the data is used to drive organizational business decisions may not yield a corresponding ROI nor move the needle on the $3.5 trillion in US healthcare spend.

Being able to make faster, data-informed decisions based on solid study design is the new competitive imperative.

As health plans increasingly look for ways to personalize their outreach and add value for their members, they face several critical challenges as they try to determine what works and what doesn’t for whom… and what to do about it. Investing in data governance and analytics capabilities are clearly the first steps to bring systems up to speed and allow for the generation of insights. However, organizational alignment and corresponding skill sets to make sense of all the insights and importantly, to make rapid decisions, are often lagging. Departments may be siloed, and the group(s) responsible for business outcomes can be very different than the one responsible for “running the reports”. This often results in requests for ad hoc analyses and study designs that don’t start with the fundamental question of “will the resulting answers get us to a decision on the business problem we are trying to solve?” Without faith in the output, decisions can be stalled for months or indefinitely as the process is questioned.

Dr. Steven Uldvarhelyi, President and CEO of Blue Cross and Blue Shield of Louisiana, is a forward-thinking leader who has been remaking his organization and culture to be focused on using analytics as a way to make better decisions. Recently, he shared his top ten lessons he’s learned in making this shift with NextHealth’s CEO, Eric Grossman. His top piece of advice? Teach people to ask the right questions.

Being able to make faster, data-informed decisions based on solid study design is the new competitive imperative. Other industries – retail, financial services, sports, etc. – have long since learned and honed their competitive edge by not only investing in analytics but in moving to more agile organizational structures to enable decision making beyond the C-suite. Companies like Amazon, Google, Capital One, Microsoft, and McDonald’s each conduct thousands of scientific business experiments a year. They recognize that the more “at bats” they have, the more they learn about what is working and not for each customer. The resulting knowledge powers daily optimization of what each of us sees on our search results and in our inboxes. Dan Humble, Chief Data and Analytics Officer at Walgreens Boots Alliance (which recently announced a major partnership with Microsoft) shared, “When you’re debating the numbers, you’re not actually engaged in an activity that’s propelling the business forward. By testing against a control group, you can focus the debate on how to maximize the performance of the business.” Said differently, it is trust in the insights that stem from an analytics investment combined with the ability to quickly act on them that drives value, not the data itself.

At NextHealth, our AI-based cloud analytics platform not only significantly cuts the time required to conduct analyses, but it allows our health plan clients to create economic value by understanding and acting on the causal relationships between business initiatives and outcomes. Speeding the time to decisions has a quantifiable and compounding impact, and it supports a true culture of measurement.

We’d love to talk to you about how NextHealth can drive value for your organization and help build your own culture of measurement. Please contact us, and we’ll get right back to you.

NextHealth was founded by industry visionaries who are passionate about empowering people to make the best healthcare decisions. Our employees are our most important asset. We are obsessive about finding new and inventive ways to continue to deliver profound customer value. The company is headquartered in Denver, Colorado – an exceptional place to live, work, and innovate.